Wendy’s announces corporate revamp, possible job cuts
Jan 13, 2023, 2:29 PM | Updated: 2:30 pm
Wendy’s said Friday it’s planning a restructuring __ and possible corporate layoffs __ in an effort to speed decision-making and invest more in new restaurant development.
The news comes just a week after rival McDonald’s announced a similar corporate reorganization, also with plans to accelerate restaurant openings and improve efficiency. McDonald’s said it will communicate more details on layoffs to employees by April 3; Wendy’s didn’t give a date.
Dublin, Ohio-based Wendy’s, the third-largest U.S. burger chain after McDonald’s and Burger King, said Friday it expects its full-year revenue will rise 10.5% to $2.1 billion in 2022. That would be higher than Wall Street’s expectations. The company plans to release its fourth-quarter and full-year earnings on March 1.
Wendy’s President and CEO Todd Penegor said during a conference call with investors that the company is starting its reorganization from a position of strength, with 12 consecutive years of growth in global same-store sales, or sales in restaurants open at least 15 months. The U.S. business accelerated in the fourth quarter with promotions like a peppermint-flavored Frosty and a $5 Biggie Bag, which combines a sandwich, chicken nuggets, fries and a drink.
But Penegor said Wendy’s needs to focus more on global store growth and digital sales. Wendy’s has nearly 6,000 restaurants in the U.S. and just over 1,000 in 31 foreign countries.
Penegor emphasized that Wendy’s will narrow its focus to traditional stores, not to-go only options or other experimental designs. He also wants the company to continue its momentum in the fast-growing breakfast segment __ which it reentered in 2020 __ and improve store operations.
“As you take some layers out of the organization and allow us speed of decision-making, it can drive focus, it will drive efficiency, it’ll drive productivity,” he said.
Wendy’s shares rose 6% to close at $23.08.
Wendy’s announced Friday that it eliminated the job of Kurt Kane, its U.S. president and chief commercial officer, who will be leaving the company. Leigh A. Burnside, the company’s chief accounting officer and a senior vice president, also announced her departure.
The company also said its board authorized the repurchase of up to $500 million in stock and doubled its quarterly dividend to 25 cents per share.
Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
